United States Reaches $255,000 Settlement with Avaya Communications Inc. Concerning its Potential Liability for the Acts of its Former Technician Who Defrauded the U.S. Department of Education

Washington, D.C. — Avaya Communications, Inc., successor to
Lucent Technologies, has agreed to pay the United States $255,000 to settle
allegations that it was financially liable under the False Claims Act for the
actions of its former technician, William Cousin, who defrauded the U.S. Department
of Education in the 1990s, U.S. Attorney Jeffrey A. Taylor and Inspector General
for the Department of Education John P. Higgins, Jr. announced today.

Cousin was a participant in a wide-ranging scheme to defraud the Department
of Education. On December 4, 2000, Cousin pled guilty to one count of 18 U.S.C.
§ 641 (Theft of Government Property) in the U.S. District Court for the District
of Columbia before the Honorable Emmett G. Sullivan.

The settlement is a result of the United States' contention that Avaya is liable
for Cousin's participation in a scheme through which the Department of Education
was defrauded of more than $1,000,000. Avaya has denied liability. A previous
settlement with the prime contractor, Verizon Federal, Inc. (formerly Bell Atlantic
Federal Systems), for two million dollars was reached in February 2002.

According to the government's evidence, Cousin was a technician employed by
Lucent (now Avaya) who was assigned full-time to the Department of Education
to install telephone systems. Any hours, including overtime and holiday hours,
that he claimed to work for the Department of Education were billed to and paid
for by the Department of Education. Sometime in the 1990s and continuing up
until December 9, 1999, Cousin began to claim that he was working far more overtime
hours than he had actually worked, at least ten hours a week over several years.
In addition to adding hundreds of unworked hours to his time sheets, the evidence
further showed that the technician also was involved in a scheme with Elizabeth
Mellen, a Department of Education telecommunications specialist who served as
the Contracting Officer's Technical Representative for the Bell Atlantic contract.

As a result of this fraudulent scheme, the Department of Education was charged
for over $159,000 of false overtime charges. The United States' claims against
Avaya were based on the False Claims Act, 31 U.S.C. § 3729, which provides for
civil penalties of up to $11,000 per claim and treble damages (i.e., three times
the amount of the government's loss).

In announcing the settlement, U.S. Attorney Taylor and Inspector General Higgins
commended members of the Department of Education's Office of Inspector General
and Office of the General Counsel. In particular, they praised the outstanding
investigative efforts and assistance of OIG Special Agents Brian Hickey and
John Hendrickson, OIG attorney Howard Sorensen, and Office of the General Counsel
Attorney Gail Baum. In addition, they commended Assistant U.S. Attorney Laurie
Weinstein who coordinated the civil investigation and settlement discussions.